Colleges try new way of downsizing scalpers

Merrisa Brown, Alan Scherzagier - Associated Press

Published
12:00 am CDT, Wednesday, June 30, 2010

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LAWRENCE, Kan. — College sports fans searching for a coveted ticket to a sold-out game can bypass the shady guys hanging outside the stadiums and arenas. Just try your favorite school’s Web site. Or go straight to the NCAA.

A scalping scheme at the University of Kansas has exposed the seamy side of the secondary ticket business, with five now-former athletic department employees and a consultant accused of keeping the profits from selling as much as $3 million worth of basketball and football tickets to brokers. A federal grand jury is reviewing the case.

The Kansas case is a rare black eye for an industry that has grown in size and legitimacy.

A 2008 Forrester Research report values the secondary ticket market for live entertainment — pro and college sports plus concerts — at $4.5 billion annually, or roughly 20 percent of the primary ticket business.

Other estimates peg the annual secondary market as high as $10 billion. Industry leaders say as many as 30 percent of concert and sporting event tickets wind up on the secondary market.

The recent ticket scandal at the University of Kansas left Jayhawks athletics director Lew Perkins fielding his share of questions from the media.

The recent ticket scandal at the University of Kansas left Jayhawks athletics director Lew Perkins fielding his share of questions from the media.

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The recent ticket scandal at the University of Kansas left Jayhawks athletics director Lew Perkins fielding his share of questions from the media.

The recent ticket scandal at the University of Kansas left Jayhawks athletics director Lew Perkins fielding his share of questions from the media.

Colleges try new way of downsizing scalpers

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The industry has its own lobbying group, the National Association of Ticket Brokers. The trade association and other industry groups hold annual summits at Las Vegas casinos and the Waldorf Astoria hotel in New York. And its political influence has led to an across-the-board decline of state and local anti-scalping laws, as well as greater cultural acceptance of ticket resales.

The NCAA in 2007 enlisted the Razorgator online exchange service as its “official ticket and hospitality package provider” for the men’s Final Four. The deal has since been extended to include the women’s Final Four, the College World Series, Frozen Four hockey tournament and the remaining four rounds of March Madness.

That means ticket sellers and buyers — fans or professional brokers playing the market — can ply their trade online under the NCAA’s seal of approval. Alumni whose school loses in the semifinals can pawn their championship game tickets at the Razorgator table inside the stadium.

Need tickets and a hotel room for the 2011 Final Four in Houston? A shade under $1,900 will get you an upper-level seat in Reliant Stadium, four nights at a nearby Marriott, a souvenir program and admission to a pregame hospitality tent with food buffets and an open bar.

Greg Shaheen, an NCAA senior vice president, said the association was tired of watching secondary market ticket sellers profit off the NCAA’s name and reputation. He said the partnership with Razorgator also allows the NCAA to limit ticket fraud.

“It acknowledges reality,” Shaheen said. “Our goal is to provide a legitimate, safe, guaranteed means by which those transactions occur.”

Razorgator charges sellers and buyers an administrative fee. Shaheen declined to disclose the specifics of the NCAA’s multiyear contract with the company.

Ticket reseller StubHub, a division of eBay, counts 13 schools among its officials partners, including Alabama, Louisville, Purdue, Stanford, USC and Wisconsin. Other schools team with industry giant Ticketmaster or provide their own programs, which sometimes are restricted to donors and season-ticket holders.